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Exhibit 10.3
Employment Agreement Dated as of March 6, 2000 between Xxxxx X. Xxxxxx and
Xxxxx Enterprises, Incorporated.
AMENDED AND RESTATED EMPLOYMENT AGREEMENT
THIS AMENDED AND RESTATED EMPLOYMENT AGREEMENT is entered into as of March 6,
2000 (the "Effective Date") by and between XXXXX ENTERPRISES, INCORPORATED, a
Florida corporation (the "Company"), and XXXXX X. XXXXXX (the "Executive").
W I T N E S S E T H :
WHEREAS, on or about November 17, 1998, the Company and the Executive entered
into an Employment Agreement (the "Prior Employment Agreement") pursuant to
which the Company employed the Executive as its President and the Executive
commenced his service to the Company in such capacity; and
WHEREAS, the Company and the Executive desire to amend and restate such
Employment Agreement to set forth certain additional and supplement of terms to
apply if, but only if, the Executive is promoted to Chairman and/or Chief
Executive Officer of the Company, which appointment is subject to the exercise
of discretion by the Board of Directors; and
WHEREAS, the Company and the Executive intend that this Agreement shall
supercede the Prior Employment Agreement;
NOW, THEREFORE, in consideration of the mutual covenants and agreements of the
parties contained herein, and other good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, the parties hereto
covenant and agree as follows:
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1. EMPLOYMENT AND DUTIES. Subject to the terms and conditions of this
Agreement, the Company shall employ the Executive during the Term (as
hereinafter defined) as the President and Chief Operating Officer of the
Company. The Executive accepts such employment and agrees to devote his best
efforts and entire business time, skill, labor and attention to the performance
of such duties. The Executive agrees to provide promptly a description of any
other commercial duties or pursuits engaged in by the Executive to the
Company's Board of Directors. If the Board of Directors determines, in good
faith, that such activities conflict with the Executive's performance of his
duties hereunder, the Executive shall promptly cease such activities to the
extent as directed by the Board of Directors. It is acknowledged and agreed
that such description shall be made regarding any such activities in which the
Executive owns more than 10% of the ownership of the organization or which may
be in violation of Section 5 hereof, and that the failure of the Executive to
provide any such description shall enable the Company to terminate the
Executive for Cause (as provided in Section 6(c) hereof). The Company agrees to
hold any such information provided by the Executive confidential and not
disclose the same to any person other than a person to whom disclosure is
reasonably necessary or appropriate in light of the circumstances. In addition,
the Executive agrees to serve without additional compensation if elected or
appointed to any additional office or position, including as a director, of the
Company or any subsidiary or affiliate of the Company; provided, however, that
the Executive shall be entitled to receive such benefits and additional
compensation, if any, that is paid to executive officers of the Company in
connection with such service.
2. TERM. Subject to the terms and conditions of this Agreement, including
but not limited to the provisions for termination set forth in Section 6
hereof, the employment of the Executive under this Agreement shall commence on
March 6, 2000 and shall continue through and including the close of business on
the second annual anniversary date thereof as set forth on Exhibit A attached
hereto and incorporated herein, or, if Executive during the term described in
Exhibit A is promoted to Chairman and/or Chief Executive Officer, the
additional term set forth on Exhibit B (such term shall herein be defined as
the "Term").
3. COMPENSATION.
(a) BASE SALARY AND BONUS.
(1) For Services As President and Chief Operating
Officer. As compensation for the Executive's
services under this Agreement as President and Chief
Operating Officer, the Executive shall receive, and
the Company shall pay, a weekly base salary set
forth on Exhibit A. Such base salary may be
increased, but not decreased, during the Term, in
the Company's discretion, based upon the Executive's
performance and any other factors the Company deems
relevant. Such base salary shall be payable in
accordance with the policy then prevailing for the
Company's executives. In addition to such base
salary, the Executive shall be entitled, during the
Term of his employment as President and Chief
Operating Officer, to a performance bonus as set
forth on Exhibit A and to participate in and receive
payments from all other bonus and other incentive
compensation plans as may be adopted by the Company
on the same basis as other executive officers of the
Company.
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(2) Upon Promotion. If, in the sole discretion of the
Company, the Executive is promoted to Chairman
and/or Chief Executive Officer, as compensation for
the Executive's services in such position under this
Agreement, the Executive shall receive, and the
Company shall pay, a weekly base salary set forth on
Exhibit B. Such base salary may be increased, but
not decreased, during the Term, in the Company's
discretion, based upon the Executive's performance
and any other factors the Company deems relevant.
Such base salary shall be payable in accordance with
the policy then prevailing for the Company's
executives. In addition to such base salary, the
Executive shall be entitled, during the portion of
the Term in which the Executive is employed as
Chairman and/or Chief Executive Officer, to a
performance bonus as set forth on Exhibit B and to
participate in and receive payments from all other
bonus and other incentive compensation plans as may
be adopted by the Company on the same basis as other
executive officers of the Company.
(b) PAYMENTS.
All amounts paid pursuant to this Agreement shall be subject to
withholding or deduction by reason of the Federal Insurance
Contribution Act, Federal income tax, state and local income tax, if
any, and comparable laws and regulations.
(c) OTHER BENEFITS.
The Executive shall be reimbursed by the Company for all reasonable
and customary travel and other business expenses incurred by the
Executive in the performance of the Executive's duties hereunder in
accordance with the Company's standard policy regarding expense
verification practices. The Executive shall be entitled to that number
of weeks paid vacation per year that is available to other executive
officers of the Company in accordance with the Company's standard
policy regarding vacations and such other fringe benefits as are set
forth on Exhibit A and, to the extent applicable, Exhibit B and shall
be eligible to participate in such pension, life insurance, health
insurance, disability insurance and other employee benefits plans, if
any, which the Company may from time to time make available to its
executive officers generally.
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4. CONFIDENTIAL INFORMATION.
(a) The Executive has acquired and will acquire information and
knowledge respecting the intimate and confidential affairs of
the Company (for this purpose including all subsidiaries and
affiliates, including without limitation confidential
information with respect to the Company's customer lists,
business methodology, processes, production methods and
techniques, promotional materials and information, and other
similar matters treated by the Company as confidential (the
"Confidential Information"). Accordingly, the Executive
covenants and agrees that during the Executive's employment
by the Company (whether during the Term hereof or otherwise)
and thereafter, the Executive shall not, without the prior
written consent of the Company, disclose to any person, other
than a person to whom disclosure is reasonably necessary or
appropriate in connection with the performance by the
Executive of the Executive's duties hereunder, any
Confidential Information obtained by the Executive while in
the employ of the Company.
(b) The Executive agrees that all memoranda, notes, records,
papers or other documents and all copies thereof relating to
the Company's operations or business, some of which may be
prepared by the Executive, and all objects associated
therewith in any way obtained by the Executive shall be the
Company's property. This shall include, but is not limited
to, documents and objects concerning any customer lists,
contracts, price lists, manuals, mailing lists, advertising
materials, and all other materials and records of any kind
that may be in the Executive's possession or under the
Executive's control. The Executive shall not, except for the
Company's use, copy or duplicate any of the aforementioned
documents or objects (except for the purpose of performing
Executive's duties) nor remove them from the Company's
facilities, nor use any information concerning them except
for the Company's benefit, either during the Executive's
employment or thereafter. The Executive covenants and agrees
that the Executive will deliver all of the aforementioned
documents and objects, if any, that may be in the Executive's
possession to the Company upon termination of the Executive's
employment, or at any other time at the Company's request.
5. COVENANT NOT TO COMPETE.
(a) Subject to the payment provisions set forth in (g) below, the
Executive covenants and agrees that during the Executive's
employment by the Company (whether during the Term hereof or
otherwise), and thereafter for a period of time set forth on
Exhibit A or Exhibit B, as applicable, following the
termination of the Executive's employment with the Company,
the Executive will not:
(i) directly or indirectly engage in, continue in or
carry on the business of any corporation,
partnership, firm or other business organization
which is now, becomes or may become a competitor of
the Company or any business substantially similar
thereto, including owning or controlling any
financial interest in, any corporation, partnership,
firm or other form of business organization which
competes with or is engaged in or carries on any
aspect of such business or any business
substantially similar thereto;
(ii) consult with, advise or assist in any way, whether
or not for consideration, any corporation,
partnership, firm or other business organization
which is now, becomes or may become a competitor of
the Company in any aspect of the Company's business
during the Executive's employment with the Company,
including, but not limited to: advertising or
otherwise endorsing the products of any such
competitor; soliciting customers or otherwise
serving as an intermediary for any such competitor;
or loaning money or rendering any other form of
financial assistance to or engaging in any form of
business transaction whether or not on an arms'
length basis with any such competitor; or
(iii) engage in any practice the purpose of which is to
evade the provisions of this Agreement or to commit
any act which is detrimental to the successful
continuation of, or which adversely affects, the
business or the Company;
provided, however, that the foregoing shall not preclude the
Executive's ownership of not more than 2% of the equity
securities of a corporation which has such securities
registered under Section 12 of the Securities Exchange Act of
1934, as amended.
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(b) The Executive agrees that the geographic scope of this
covenant not to compete shall extend to the geographic area
where the Company's customers conduct business at any time
during the Term of this Agreement. For purposes of this
Agreement, "customers" means any person or entity to which
the Company provides or has provided within a period of one
(1) year prior to the Executive's termination of employment
labor, materials or services for the furtherance of such
entity or person's business or any person or entity that
within such period of one (1) year the Company has pursued or
communicated with for the purposes of obtaining business for
the Company.
(c) In the event of any breach of this covenant not to compete,
the Executive recognizes that the remedies at law will be
inadequate and that in addition to any relief at law which
may be available to the Company for such violation or breach
and regardless of any other provision contained in this
Agreement, the Company shall be entitled to equitable
remedies (including an injunction) and such other relief as a
court may grant after considering the intent of this Section
5. It is further acknowledged and agreed that the existence
of any claim or cause of action on the part of the Executive
against the Company, whether arising from this Agreement or
otherwise, shall in no way constitute a defense to the
enforcement of this covenant not to compete, and the duration
of this covenant not to compete shall be extended in an
amount which equals the time period during which the
Executive is or has been in violation of this covenant not to
compete. Further, the Executive acknowledges and agrees that
the Company shall be entitled to liquidated damages in the
amount of $500 per day for each day during which the
Executive is in violation of this covenant not to compete,
and the Executive does specifically acknowledge and agree
that the liquidated damages in such amount are fair and
reasonable, in that it may be difficult for the Company to
determine the extent of the damages actually incurred in the
event of the breach of this covenant not to compete by the
Executive.
(d) In the event a court of competent jurisdiction determines
that the provisions of this covenant not to compete are
excessively broad as to duration, geographic scope,
prohibited activities or otherwise, the parties agree that
this covenant shall be reduced or curtailed to the extent
necessary to render it enforceable.
(e) For the purposes of this Section 5, Company shall be deemed
to include the Company, as well as its subsidiaries and
affiliates.
(f) The parties hereto expressly acknowledge and agree that any
provision of this Section 5 may be amended or waived by the
mutual written agreement of both parties.
(g) In addition to complying with the notice requirements of
Section 6, in order for the covenant not to compete set forth
in this Section 5 to be binding upon the Executive, the
Company must comply with the following provisions:
(i) If the Company should terminate the Executive's
employment for any reason other than pursuant to
Section 6 prior to the end of the Term (or if the
Executive should terminate his employment for Good
Reason after a Change of Control), then the Company
must pay the Executive both the applicable Severance
Payment for the balance of the Term (or in the event
of a Change of Control, the Change of Control
Termination Payment) and an annual amount equal to
the Severance Payment for such period as the
covenant not to compete is to remain in effect at
the election of the Company after the end of the
Term (with such 12-month or 24-month period to be
noticed by the Company pursuant to Section 6).
(ii) If the Executive remains in the employ of the
Company pursuant to the terms of this Agreement for
the full Term, and the employment of the Executive
is not renewed at such time, then the Company must
pay the Executive an annual amount equal to the
Severance Payment for such period as the covenant
not to compete is to remain in effect at the
election of the Company after the end of the Term
(with such 12-month or 24-month period to be noticed
by the Company pursuant to Section 6).
(iii) If the Executive should terminate his employment
prior to the end of the Term (for other than Good
Reason in the event of a Change of Control), then
after the Company has given notice pursuant to
Section 6, the Company will not be required to make
any payment to the Executive for
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the covenant not to compete to be effective for the
12-month or 24-month period noticed by the Company
pursuant to Section 6.
6. TERMINATION.
a. DEATH. The Executive's employment hereunder shall terminate
upon his death.
b. DISABILITY. If, during the Term, the Executive becomes
physically or mentally disabled in accordance with the terms
and conditions of any disability insurance policy covering
the Executive or, if due to such physical or mental
disability, the Executive becomes unable for a period of more
than six (6) consecutive months to perform his duties
hereunder on substantially a full-time basis as determined by
the Company in its sole reasonable discretion, the Company
may, at its option, terminate the Executive's employment
hereunder upon the termination of the six (6) month period
referenced in this Section 6(b).
c. CAUSE. The Company may terminate the Executive's employment
hereunder for Cause effective immediately upon notice. For
purposes of this Agreement, the Company shall have "Cause" to
terminate the Executive's employment hereunder: (i) if the
Executive engages in conduct which has caused, or is
reasonably likely to cause, substantial and serious injury to
Company; (ii) if the Executive is convicted of a felony, as
evidenced by a binding and final judgment, order or decree of
a court of competent jurisdiction; (iii) for the Executive's
repeated neglect of his duties hereunder or the Executive's
refusal to perform his duties or responsibilities hereunder,
as determined by the Company's Board of Directors in good
faith; (iv) for the Executive's violation of this Agreement,
including without limitation Section 5 hereof; (v) chronic
absenteeism; (vi) use of illegal drugs or addiction to habit
forming drugs; (vii) insobriety by the Executive while
performing his or her duties hereunder; and (viii) any act of
dishonesty or falsification of reports, records or
information submitted by the Executive to the Company. Prior
to any termination for Cause by the Company of the
Executive's employment hereunder (other than for Cause which
is not reasonably curable by the Executive), the Company
shall provide the Executive with written notice of its
intention so to terminate (the "Termination Notice"). The
Termination Notice shall set forth in reasonable detail the
grounds for the termination for Cause. The Company hereby
expressly acknowledges and agrees that the Executive shall be
granted a period of thirty (30) days from the date of the
receipt by the Executive of the Termination Notice, in order
to remedy any act or omission of the Executive which
constitutes the grounds for Cause hereunder.
x. XXXXXXXXX PAYMENT. In the event of a termination of the
Executive's employment pursuant to this Section 6, or by the
Executive, prior to the end of the Term, all payments to the
Executive hereunder shall immediately cease and terminate. In
the event of a termination by the Company of the Executive's
employment with the Company for any reason other than
pursuant to this Section 6, then the Company shall pay the
Executive severance pay for the balance of the Term (in equal
installments in accordance with Company policy immediately
prior to such termination) in the amount set forth on Exhibit
A or Exhibit B, as applicable ("Severance Payment").
If the Company terminates the Executive's employment pursuant to this
Section 6 or the Executive terminates such employment, prior to the end of the
Term, the Executive shall not be entitled to the Severance Payment and the
covenant not to compete set forth in Section 5 hereof shall remain in full
force and effect for either a 12 or 24 month period noticed by the Company
pursuant to this Section 6. Notwithstanding anything to the contrary herein
contained, the Executive shall receive all compensation and other benefits to
which he was entitled under this Agreement or otherwise as an employee of the
Company through the termination date.
In all events where the Company elects to enforce the covenant not to
compete set forth in Section 5 hereof after Executive is no longer in the
employment of the Company it shall notify Executive in writing as follows:
(i) Prior to the end of the Term, if Executive's employment has
not been terminated prior to the end of the Term;
(ii) Within ten (10) days of the Company's receipt of Executive's
resignation if termination is by the Executive; and
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(iii) If termination is for Cause at the time Company notifies
Executive if Termination for Cause.
7. TERMINATION AFTER CHANGE OF CONTROL. In the event Executive's
employment hereunder is terminated for any of the reasons set forth in Section
6a, b or c, or by the Executive (other than for Good Reason, defined herein
below), then this Section 7, dealing with Change of Control, shall have no
effect. If, however, Executive's employment hereunder is terminated (i) by the
Executive for Good Reason; (ii) other than by the Executive and (iii) other
than as set forth in Section 6a, b or c, then, in that event, Executive shall
receive (in equal installments and in accordance with company policy
immediately prior to such termination) an amount to be determined by
multiplying by two (2) Executive's base salary and actual bonus for the
calendar year immediately prior to such termination ("Change of Control
Termination Payment"). A "Change in Control" shall be deemed to have occurred
if the event set forth in any one of the following paragraphs shall have
occurred:
a. the following individuals cease for any reason to constitute
a majority of the number of directors then serving:
individuals who, after the annual meeting of shareholders of
the Company held in 2000, constituted the Board of Directors
and any new director (other than a director whose initial
assumption of office is in connection with an actual or
threatened election contest, including but not limited to a
consent solicitation, relating to the election of directors
of the Company, as such terms are used in Rule 14a-11 of
Regulation 14A under the Act) whose appointment or election
by the Board or nomination for election by the Company's
stockholders was approved by a vote of at least two-thirds
(2/3) of the directors then still in office who either were
directors after the annual meeting of shareholders of the
Company held in 2000 or whose appointment, election or
nomination for election was previously so approved; or
b. the stockholders of the Company approve a merger,
consolidation or share exchange of the Company with any other
corporation or approve the issuance of voting securities of
the Company in connection with a merger, consolidation or
share exchange of the Company (or any direct or indirect
subsidiary of the Company) pursuant to applicable stock
exchange requirements, other than (A) a merger, consolidation
or share exchange which would result in the voting securities
of the Company outstanding immediately prior to such merger,
consolidation or share exchange continuing to represent
(either by remaining outstanding or by being converted into
voting securities of the surviving entity or any parent
thereof) at least 50% of the combined voting power of the
voting securities of the Company or such surviving entity or
any parent thereof outstanding immediately after such merger,
consolidation or share exchange, or (B) a merger,
consolidation or share exchange effected to implement a
recapitalization of the Company (or similar transaction) in
which no Person (other than Xxxx X. Xxxxx) is or becomes the
beneficial owner, directly or indirectly, of securities of
the Company (not including in the securities beneficially
owned by such Person any securities acquired directly from
the Company or its Affiliates after the annual meeting of
shareholders of the Company held in 2000 pursuant to express
authorization by the Board that refers to this exception)
representing 45% or more of either the then outstanding
shares of common stock of the Company or the combined voting
power of the Company's then outstanding voting securities; or
c. The stockholders of the Company approve a plan of complete
liquidation or dissolution of the Company or an agreement for
the sale or disposition by the Company of all or
substantially all of the Company's assets (in one transaction
or a series of related transactions within any period of 24
consecutive months), other than a sale or disposition by the
Company of all or substantially all of the Company's assets
to an entity at least 75% of the combined voting power of the
voting securities of which are owned by Persons in
substantially the same proportions as their ownership of the
Company immediately prior to such sale.
d. Notwithstanding the foregoing, no "Change in Control" shall
be deemed to have occurred if there is
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consummated any transaction or series of integrated
transactions immediately following which the record holders
of the common stock of the Company immediately prior to such
transaction or series of transactions continue to have
substantially the same proportionate ownership in an entity
that owns all or substantially all of the assets of the
Company immediately following such transaction or series of
transactions.
The Executive may terminate his employment pursuant to and only after
the condition of this Section 7 has occurred for Good Reason; and the Company
expressly acknowledges and agrees that, upon such termination, the Executive
shall be entitled to the Change of Control Termination Payment, as hereinafter
defined, to which the Executive, but for such termination, would otherwise be
entitled. For purposes of this Agreement, "Good Reason" shall mean: (i) any
reduction of the Base Salary or any other compensation or benefits (other than
the Performance Bonus); and (ii) any other material adverse change to the terms
and conditions of the Executive's employment, including but not limited to any
diminution of the Customary Duties (as here below defined), or the title of
President of the Company.
Subsequent to a Change of Control, the Executive shall continue to
hold such office and such level of authority and responsibility within the
Company either (a) as was held immediately prior to such Change of Control or
(b) of such scope, importance and influence as is customarily associated with
the office of president of a company similar to the Company (hereinafter
collectively referred to as the "Customary Duties").
8. TAX PROVISIONS.
a. No Excess Parachute Payment. It is the intention of the
Company and the Executive that no portion of the Severance
Payment or any other payment or benefit under this Agreement,
or payments to or for the benefit of the Executive under any
other agreement or plan (collectively, the "Severance
Benefits") be deemed to be an excess parachute payment as
defined in Section 280G of the Internal Revenue Code of 1986,
as amended (the "Code") or any successor provision thereto.
Notwithstanding any other provision of this Agreement, if any
portion of the Severance Benefits would constitute a
parachute payment within the meaning of Section 280G of the
Code, such Severance Benefits shall be reduced to an amount
equal to One Dollar ($1.00) less than the maximum amount
which the Executive may receive without becoming subject to
the tax imposed by Section 4999 of the Code (or any successor
provision) or which the Company may pay without loss of
deduction under Section 280G(a) of the Code (or any successor
provision).
b. Opinion. For purposes of this Section, within sixty (60) days
after delivery of a written notice of termination by the
Executive or by the Company pursuant to this Agreement or
written notice by the Company to the Executive of its belief
that there is a payment or benefit due the Executive which
will result in an excess parachute payment as defined in
Section 280G of the Code or any successor provision thereto,
the Executive and the Company shall obtain, at the Company's
expense, the opinion (which need not be unqualified) of
nationally recognized tax counsel ("Tax Counsel") selected by
the Company's independent auditors and acceptable to the
Executive in the Executive's sole discretion, which sets
forth (A) the "base amount" within the meaning of Section
280G; (B) the aggregate present value of the payments in the
nature of compensation to the Executive as prescribed in
Section 280G(b)(2)(A)(ii); and (C) the amount and present
value of any "excess parachute payment" within the meaning of
Section 280G(b)(1). If such an opinion of Tax Counsel is
sought, no portion of the Severance Payment shall be paid to
the Executive by the Company until ten (10) days after the
opinion is obtained.
In the event that such opinion determines that there would be an
excess parachute payment, the Severance Benefits shall be reduced or eliminated
as specified by the Executive in a written notice delivered to the Company
within thirty (30) days of his receipt of such opinion or, if the Executive
fails to so notify the Company then as the Company shall reasonably determine,
so that under the bases of calculation set forth in such opinion there will be
no excess parachute payment. For purposes of such opinion, the value of any
non-cash benefits or any deferred payment or benefit shall be determined by the
Company's independent auditors in accordance with the principles of Sections
280G, which determination shall be evidenced in a certificate of such auditors
addressed to the Company and the Executive. Such opinion shall be dated as of
the date of termination of the Executive's employment and addressed to the
Company
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and the Executive and shall be binding upon the Company and the Executive.
The provisions of this Section 8(b), including the calculations,
notices and opinions provided for herein shall be based upon the conclusive
presumption that the compensation earned by the Executive pursuant to the
Company's compensation programs prior to a change of control is reasonable,
provided, however, that in the event such Tax Counsel so requests in connection
with the opinion required by this Section 8(b), the Company shall obtain at its
expense, and Tax Counsel may rely on in providing the opinion, the advice of a
firm of recognized executive compensation consultants as to the reasonableness
of any item of compensation to be received by the Executive.
c. Ruling. The Executive shall have the right to request that
the Company obtain a ruling from the Internal Revenue Service ("IRS") as to
whether any or all payments or benefits determined by such Tax Counsel are, in
the view of the IRS, "parachute payments" under Section 280G. If a ruling is
sought pursuant to the Executive's request, no Severance Benefits payable under
this Agreement in excess of the Section 280G limitation shall be made to the
Executive until after fifteen (15) days from the date of such ruling; however,
Severance Benefits shall continue to be paid during the time up to the amount
of that limitation. For purposes of this Section 6, the Executive and the
Company shall agree to be bound by the IRS's ruling as to whether payments
constitute "parachute payments" under Section 280G. If the IRS declines, for
any reason, to provide the ruling requested, the Tax Counsel's opinion shall
control and the period during which the Severance Benefits may be deferred
shall be extended to a date fifteen (15) days from the date of the IRS's notice
indicating that no ruling would be forthcoming.
9. NOTICE. For purposes of this Agreement, notices and all other
communications provided for herein shall be in writing and shall be deemed to
have been duly given when hand-delivered, sent by telecopier, facsimile
transmission or other electronic means of transmitting written documents (as
long as receipt is acknowledged) or mailed by United States certified or
registered mail, return receipt requested, postage prepaid, addressed as
follows:
If to the Executive, to the address set forth on the signature page
If to the Company:
Xxxxx Enterprises, Incorporated
000 Xxxxx Xxxxx Xxxxxx
Xxxxx 0000
Xxxxx, Xxxxxxx 00000
Attn: Chief Executive Officer
CC: General Counsel
or to such other address as either party may have furnished to the other in
writing in accordance herewith, except that a notice of change of address shall
be effective only upon receipt.
10. MISCELLANEOUS. No provision of this Agreement may be modified or
waived unless such waiver or modification is agreed to in writing signed by the
parties hereto; provided, however, Exhibit A may be amended by the Company in
its discretion without the Executive's consent to the extent provided therein.
No waiver by any party hereto of any breach by any other party hereto shall be
deemed a waiver of any similar or dissimilar term or condition at the same or
at any prior or subsequent time. This Agreement is the entire agreement between
the parties hereto with respect to the Executive's employment by the Company
and there are no agreements or representations, oral or otherwise, expressed or
implied, with respect to or related to the employment of the Executive which
are not set forth in this Agreement. Any prior agreement relating to the
Executive's employment with the Company is hereby superceded and void, and is
no longer in effect. This Agreement shall be binding upon and inure to the
benefit of the Company, its respective successors and assigns, and the
Executive and his heirs, executors, administrators and legal representatives.
Except as expressly set forth herein, no party shall assign any of his or its
rights under this Agreement without the prior written consent of the other
party and any attempted assignment without such prior written consent shall be
null and void and without legal effect. The parties agree that if any provision
of this Agreement shall under any circumstances be
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deemed invalid or inoperative, the Agreement shall be construed with the
invalid or inoperative provision deleted and the rights and obligations of the
parties shall be construed and enforced accordingly. The validity,
interpretation, construction and performance of this Agreement shall be
governed by the internal laws of the State of Florida. This Agreement may be
executed in one or more counterparts, each of which shall be deemed to be an
original but all of which together will constitute but one and the same
instrument. This Agreement has been jointly drafted by the respective
representatives of the parties and no party shall be considered as being
responsible for such drafting for the purpose of applying any rule constituting
ambiguities against the drafter or otherwise.
IN WITNESS WHEREOF, the parties have executed this Agreement as of the day and
year first above written.
XXXXX ENTERPRISES, INCORPORATED
Dated: March 6, 2000 By:
---------------------------- -----------------------------------
Xxxx X. Xxxxx, Chief Executive
Officer
EXECUTIVE
Dated: March 6, 2000
---------------------------- -----------------------------------
XXXXX X. XXXXXX
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EXHIBIT A TO EMPLOYMENT AGREEMENT
This Exhibit A shall be effective from the Effective Date of this Agreement,
through the date on which Exhibit B shall become effective in accordance with
its terms. In the event that Exhibit C shall become effective, this Exhibit A
shall continue to be effective, except as modified in the manner described in
Exhibit C.
Term: Five (5) years from the Effective Date (March 6, 2000).
Base Salary: $8,173.08 per week, effective March 6, 2000.
Performance Bonus: up to 50% Base Salary as determined by the Chairman of the
Company, payable at the time during the year that the Company customarily pays
bonuses. The annual performance Bonus will be based upon the following factors,
weighted in the manner below indicated, unless otherwise agreed by the Company
and the Executive:
50% Achieving all street expectations for the quarters and the
relevant year
30% Achieving the Operating Plan for the relevant year
20% Personal effectiveness of the Executive in his assigned role
Performance Options: For each calendar year in which this Exhibit A shall be in
effect, the Executive shall be granted options to acquire 100,000 shares at an
exercise price determined in accordance with the terms of the 1997 Management
Stock Incentive Plan which, for grants under the 1997 Management Stock
Inventive Plan for 2000, is $18. The Performance Options shall be awarded with
reference to the following standards.
1. Financial Performance. For each calendar year in which this
Exhibit A shall be in effect, the Executive shall be granted options to acquire
30,000 shares which shall vest quarterly in accordance with the following
Schedule upon meeting the financial performance standards stated below:
Standard Q1 Q2 Q3 Q4
-------- -- -- -- --
Revenues at street level 2,500 2,500 2,500 2,500
Gross Profit Margin at
street level 2,500 2,500 2,500 2,500
Operating Net Profit at
street level 2,500 2,500 2,500 2,500
In the event that each of the foregoing financial performance standards are met
for each quarter, an additional award of 20,000 options shall be made.
12
2. Operating Plan. In addition to the foregoing, an award of up
to 50,000 options shall be made based upon meeting the Company's Operating
Plan, as follows:
Percent of Operating
Plan Options
---- -------
80% 10,000
85% 20,000
90% 30,000
95% 40,000
100% 50,000
Award of Stock Options On Effective Date of Agreement. On the Effective Date of
this Agreement, the Executive shall be awarded 75,000 options at an exercise
price of $18 per share under the Xxxxx Enterprises, Incorporated Employee Stock
Option Plan of 1996, which shall vest in equal installments of 25,000 shares on
the first, second and third anniversaries of this Agreement.
Fringe Benefits: The Company will reimburse you, both the initiation and
monthly membership dues for Palma Ceia Country Club, Xxxxx Country Club and a
downtown luncheon club or a luncheon club in the Tampa area of a similar
quality and reputation.
Covenant Not to Compete: 24 months or 12 months as noticed by the Company.
Severance Payment: $425,000 per year.
IN WITNESS WHEREOF, the parties have executed this Exhibit A as of the 6th day
of March, 2000.
XXXXX ENTERPRISES, INCORPORATED
By:
-------------------------------------
Xxxx X. Xxxxx, Chief Executive
Officer
----------------------------------------
XXXXX X. XXXXXX
13
EXHIBIT B TO EMPLOYMENT AGREEMENT
Upon the appointment by the Board of Directors of the Company of the Executive
as the Chairman and/or Chief Executive Officer of the Company (which
appointment is subject to the exercise of the Board's discretion, and is not
assured), the terms of this Exhibit B shall become immediately effective.
Term: Commencing upon appointment of the Executive by the Board of Directors of
the Company as the Chairman and/or Chief Executive Officer of the Company, a
term ending on the fifth anniversary of the effective Date of this Agreement,
with no provision for any automatic renewal.
Base Salary: $10,096.16 per week.
Performance Bonus: up to 75% Base Salary as determined by the Board of
Directors of the Company, payable at the time during the year that the Company
customarily pays bonuses. The annual performance Bonus will be based upon the
following weighted factors, unless otherwise agreed by the Company and the
Executive:
50% Achieving all street expectations for the quarters and the
relevant year
30% Achieving the Operating Plan for the relevant year
20% Personal effectiveness of the Executive in his assigned role.
Performance Options: For each calendar year in which this Exhibit B shall be in
effect, the Executive shall be granted options to acquire 160,000 shares at an
exercise price determined in accordance with the terms of the 1997 Management
Stock Incentive Plan. The Performance Options shall be awarded with reference
to the following standards.
1. Financial Performance. For each calendar year in which this
Exhibit B shall be in effect, the Executive shall be granted options to acquire
60,000 shares which shall vest quarterly in accordance with the following
Schedule upon meeting the financial performance standards stated below:
Standard Q1 Q2 Q3 Q4
-------- -- -- -- --
Revenues at street level 5,000 5,000 5,000 5,000
Gross Profit Margin at
street level 5,000 5,000 5,000 5,000
Operating Net Profit at
street level 5,000 5,000 5,000 5,000
In the event that each of the foregoing financial performance standards are met
for each quarter, an additional award of 20,000 options shall be made.
14
2. Operating Plan. In addition to the foregoing, an award of up to 80,000
options shall be made based upon meeting the Company's Operating Plan, as
follows:
Percent of Operating
Plan Options
---- -------
80% 16,000
85% 32,000
90% 48,000
95% 64,000
100% 80,000
Additional Award of Stock Options On Date Exhibit B Becomes Effective. Upon
becoming Chairman and/or Chief Executive Officer, the Executive shall be
awarded 100,000 options under the Xxxxx Enterprises, Incorporated Employee
Stock Option Plan of 1996, which shall vest in equal installments on the first,
second and third anniversaries of the date that this Exhibit B becomes
effective.
Fringe Benefits: The Company will reimburse you, both the initiation and
monthly membership dues for Palma Ceia Country Club, Xxxxx Country Club and a
downtown luncheon club or a luncheon club in the Tampa area of a similar
quality and reputation.
Covenant Not to Compete: 24 months.
Severance Payment: $525,000 per year
IN WITNESS WHEREOF, the parties have executed this Exhibit B as of the 6th day
of March, 2000.
XXXXX ENTERPRISES, INCORPORATED
By:
-------------------------------------
Xxxx X. Xxxxx, Chief Executive
Officer
----------------------------------------
XXXXX X. XXXXXX
15
EXHIBIT C TO EMPLOYMENT AGREEMENT
In the event that the Executive shall not have been appointed Chairman and/or
Chief Executive Officer by May 6, 2001, then, effective on May 6, 2001, the
provisions of Exhibit B relating to awards of stock options under the captions
"Performance Options" and the "Additional Award of Stock Options on Date that
Exhibit B Becomes Effective" shall become effective.
Furthermore, upon a Change in Control, as defined in this Agreement (i) the
provisions of Exhibit B relating to awards of stock options under the captions
"Performance Options" and the "Additional Award of Stock Options on Date
Exhibit B Becomes Effective" shall become effective, in lieu of the applicable
provisions of Exhibit A, and (ii) all options previously awarded to the
Executive shall immediately vest.
IN WITNESS WHEREOF, the parties have executed this Exhibit C as of the 6th day
of March, 2000.
XXXXX ENTERPRISES, INCORPORATED
By:
-------------------------------------
Xxxx X. Xxxxx, Chief Executive
Officer
----------------------------------------
XXXXX X. XXXXXX
